•••
CO L U M N
THYS GROBBELAAR
GRAIN MARKET PROSPECTS:
MAY 2016: Market movements
THYS GROBBELAAR
SENIOR GRAIN ANALYST,
SENWES GRAINLINK
BACKGROUND
International fundamental
factors
The strength of the dollar against
other important international
currencies, such as the euro, plays
a huge role in international price
formation of certain commodities.
The American dollar weakened by
nearly 10% against the euro since
November 2015. As a result American corn is relatively cheap in the
world market. This, in turn, encourages exports and brings about
a decline in calculated carry-over
stock levels, which support prices.
Graph 1. Dollar/Euro exchange rate movement.
Graph 2. The international crude oil price/barrel. (CME)
Graph 3. Price movement of American yello corn on CBOT. (c/bu)
36 JUN/JUL 2016
• SENWES Scenario